Amazon.com 2000 Annual Report Download - page 53

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Company historically has classified shipping charges to customers as revenue. With respect to the classification
of costs related to shipping and handling incurred by the seller, the EITF determined that the classification of
such costs is an accounting policy decision that should be disclosed. Adoption of this consensus did not change
the Company’s existing accounting policies or disclosures.
Reclassifications
Certain prior year amounts have been reclassified to conform to the current year presentation.
Note 2—BUSINESS COMBINATIONS
The Company completed the following acquisitions during 1999: e-Niche Incorporated (Exchange.com),
Accept.com Financial Services Corporation, Alexa Internet (Alexa), LiveBid.com, Inc. (Livebid), the catalog
and online commerce assets of Acme Electric Motor Co. (Tool Crib), Back to Basics Toys, Inc. (Back to
Basics), and other less significant acquisitions. The aggregate original purchase price of these acquisitions, plus
related charges, was approximately $780 million. The consideration for the acquisitions was comprised of
common stock and cash. The Company originally issued an aggregate of approximately 10 million shares of its
common stock to effect these transactions. Pursuant to the terms of certain of these acquisitions, the Company
issued approximately 866,000 additional shares during 2000 with a value of approximately $32 million; these
additional shares increased the purchase price of the related transactions and corresponding goodwill. Each
transaction was recorded under the purchase method of accounting, and results of operations for each acquired
company have been included in the financial results of the Company from the closing date of each transaction
forward. The goodwill and other intangibles are being amortized on a straight-line basis over a period of two to
four years and are subject to the Company’s periodic impairment evaluation.
No significant acquisitions occurred during 2000.
Note 3—CASH AND MARKETABLE SECURITIES
The following tables summarize, by major security type, the Company’s cash and marketable securities:
Cash and Cash Equivalents
December 31, 2000
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Estimated
Fair Value
(in thousands)
Cash ..................................... $141,922 $ — $ — $141,922
Commercial paper and short-term obligations ....... 696,545 87 (18,737) 677,895
Asset-backed and agency securities ............... 2,618 — — 2,618
$841,085 $ 87 $(18,737) $822,435
December 31, 1999
Amortized
Cost
Gross
Unrealized
Gains
Gross
Unrealized
Losses
Estimated
Fair Value
(in thousands)
Cash ..................................... $116,961 $ — $ — $116,961
Commercial paper and short-term obligations ....... 16,348 — — 16,348
$133,309 $ — $ — $133,309
AMAZON.COM, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
45